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Living For Today Catches Up With Boomers

Baby Boomers, like every other generation, have done great things and not so great things. We can take credit for music icons like Bob Dylan, The Beatles, and Bonnie Raitt (for a start), shattering—or putting one heck of a hole in—the glass ceiling, forging feminism and the civil rights movement, promoting safe sex, making seat belts mandatory, launching Voyager I into outer space, creating the Internet (for better or worse) and as a result, a global community, greatly reducing the use of capital punishment, and increasing awareness of climate change—even though we’ve also been part of the problem.

But, we are also the generation of excess and living beyond our means. We invented McMansions, Visa and MasterCard, shopping malls, and pushed an obsession with consumerism to new heights.

As a whole, the 75 million Baby Boomers living in the U.S. have saved less money and piled up more debt than any generation preceding us and, for the first time in history, we have more credit-card debt than the generations succeeding us (according to recent data published by the AARP Public Policy Institute). Federal Reserve data concludes that debt held by citizens between the ages of 50 and 80 soared to about 60 percent between 2003 and 2015, while decreasing among Americans under 50.

Couple this with the 2008 financial crisis, causing job layoffs, pay cuts and/or stagnation, a rapid decline of home values, and an increase in home foreclosures. And then, add in the burden of outrageously inflated college tuitions that, for those who had kids later in life, has to be paid toward the end of their careers.

So, it’s no surprise some Boomers are finding themselves in a tough situation, facing such realities as putting off retirement, relocating to less expensive parts of the country, and seriously cutting back on spending.

To get a local perspective, I talked with Carl Casper, vice president of customer advocacy at Connex Credit Union, one of the largest credit unions in Connecticut, headquartered in North Haven with offices statewide including Branford and Guilford. A nonprofit cooperative, Connex is owned by its members and provides them with financial literacy tools for everything including creating a budget, fixing a credit report, balancing a checkbook, and negotiating a deal on a car.

Casper says he does see a lot of their older members who are still employed or recently retired relocating to Florida and South Carolina—not only for the warmer climate.

“We see as people are getting older and costs continue to escalate, particularly in this state, and taxes go up, they can’t manage the way they used to.”

A Gen-Xer himself, Casper sees people of all ages with sizable debt, who can’t afford to put money aside for their children’s tuition or even for an emergency fund, and he acknowledges that this is a big problem among Boomers.

“When you look at the Baby Boomer generation, they grew up on debt, having a big mortgage, credit card bills, student loan debt, auto loans. It was acceptable,” Casper says. “It was how people financed [purchases]. Sometime in the late ’80s, after the first financial crash, leveraging (borrowed capital to increase potential return on an investment) became a bad thing.

“It’s heartbreaking when people come to us in their mid- or late-60s and all they’re living on is Social Security, a couple hundred dollars a week, and nothing in savings,” he says.

Casper points out that being in debt and not having a retirement plan isn’t limited to people with lower incomes.

“You’d be surprised, even people who make good salaries still mismanage their money or don’t manage it appropriately,” he says.

But it’s not all gloom and doom. It’s not too late or too difficult for Baby Boomers to climb out of a financial hole with some support and guidance.

“Just doing one or two or three things can make a difference,” he says. “Reduce your cable service, go to the library to use the Internet. Buy online in bulk when you can. How about eating out once a week instead of four times a week? Fundamental little shifts start to accumulate. If you free up $300 a month and put $100 in a savings account, it provides some money for an emergency fund, or even to take a vacation.”

Of course, it’s also essential to reduce credit card debt, and to pay off high interest credit card balances.

And, citizens today have much more flexibility in terms of whether or not they choose to work past typical retirement ages—either full or part-time—both to stay active and connected as we are living to older ages, as well as out of financial necessity.

But planning early is key, and Casper encourages people to start planning for their futures by looking at the big picture early on in their adult lives.

“You’d be surprised how many people don’t even have a simple budget, don’t know where the money is coming from, or going,” he says.

“You plan before you run a marathon. That’s how your financial life is. It’s not a sprint, it’s a marathon,” Casper stresses. “You need building blocks to get you to the end of the day.”

Connex holds free educational workshops on various financial topics including budgeting, credit scores, reverse mortgages, Medicare, identity theft, etc. For more information, visit www.connexcu.org.

Amy J. Barry is a Baby Boomer, who lives in Stony Creek with her husband and assorted pets. She writes features and reviews for Shore Publishing newspapers and is an expressive arts educator. Contact her at www.aimwritect.net.